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Gentex (GNTX) Rides on Product Strategy Despite Expense Woes
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We issued an updated research report on Gentex Corporation (GNTX - Free Report) on Aug 21.
Zeeland, MI-based Gentex is engaged in supplying automatic-dimming rearview mirrors and electronics to the automotive industry. The company’s improved product strategy, with better mix and innovative launches, aids its revenue growth momentum. Though Gentex’s earnings per share and revenues missed the Zacks Consensus Estimate in second-quarter 2018, both improved year over year.
Over the past six months, shares of Gentex have outperformed the industry it belongs to. Over this time frame, shares of the company have increased 5.8%, whereas the industry declined by 8.5%. However, the Zacks Consensus Estimate for both the current quarter and current year earnings has declined over the past month.
The company strives for long-term growth through product launches, improved product mix and unique technology platforms, while executing operational discipline, designed around shareholder return. It persistently endeavors at to provide unique, value-added solutions for its customers that provide scalable platforms focused on consumers.
However, higher operating expenses are a concern before the company. In the first half of 2018, operating expenses were up around 9% to $90.2 million on a year-over-year basis, mainly owing to higher staffing levels. Moreover, cost escalation due to higher tariff is likely to put pressure on gross margin. Gross margin (including additional tariff costs) outlook for 2018 has been changed from 38-39% to 37.5-38.5%.
Zacks Rank & Key Picks
Gentex currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the auto space are Fox Factory Holding Corporation (FOXF - Free Report) , Honda Motor Co., Ltd. (HMC - Free Report) and AB Volvo (VLVLY - Free Report) . While Fox Factory sports a Zacks Rank #1 (Strong Buy), both Honda and Volvo carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Fox Factory has an expected long-term growth rate of 16.8%. Over a year, shares of the company have gained 68.4%.
Honda has an expected long-term growth rate of 3%. Shares of the company have risen 9.3% in the past year.
AB Volvo has an expected long-term growth rate of 15%. Over the past two years, shares of the company have gained 57.2%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
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Gentex (GNTX) Rides on Product Strategy Despite Expense Woes
We issued an updated research report on Gentex Corporation (GNTX - Free Report) on Aug 21.
Zeeland, MI-based Gentex is engaged in supplying automatic-dimming rearview mirrors and electronics to the automotive industry. The company’s improved product strategy, with better mix and innovative launches, aids its revenue growth momentum. Though Gentex’s earnings per share and revenues missed the Zacks Consensus Estimate in second-quarter 2018, both improved year over year.
Over the past six months, shares of Gentex have outperformed the industry it belongs to. Over this time frame, shares of the company have increased 5.8%, whereas the industry declined by 8.5%. However, the Zacks Consensus Estimate for both the current quarter and current year earnings has declined over the past month.
The company strives for long-term growth through product launches, improved product mix and unique technology platforms, while executing operational discipline, designed around shareholder return. It persistently endeavors at to provide unique, value-added solutions for its customers that provide scalable platforms focused on consumers.
However, higher operating expenses are a concern before the company. In the first half of 2018, operating expenses were up around 9% to $90.2 million on a year-over-year basis, mainly owing to higher staffing levels. Moreover, cost escalation due to higher tariff is likely to put pressure on gross margin. Gross margin (including additional tariff costs) outlook for 2018 has been changed from 38-39% to 37.5-38.5%.
Zacks Rank & Key Picks
Gentex currently carries a Zacks Rank #3 (Hold). A few better-ranked stocks in the auto space are Fox Factory Holding Corporation (FOXF - Free Report) , Honda Motor Co., Ltd. (HMC - Free Report) and AB Volvo (VLVLY - Free Report) . While Fox Factory sports a Zacks Rank #1 (Strong Buy), both Honda and Volvo carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Fox Factory has an expected long-term growth rate of 16.8%. Over a year, shares of the company have gained 68.4%.
Honda has an expected long-term growth rate of 3%. Shares of the company have risen 9.3% in the past year.
AB Volvo has an expected long-term growth rate of 15%. Over the past two years, shares of the company have gained 57.2%.
More Stock News: This Is Bigger than the iPhone!
It could become the mother of all technological revolutions. Apple sold a mere 1 billion iPhones in 10 years but a new breakthrough is expected to generate more than 27 billion devices in just 3 years, creating a $1.7 trillion market.
Zacks has just released a Special Report that spotlights this fast-emerging phenomenon and 6 tickers for taking advantage of it. If you don't buy now, you may kick yourself in 2020.
Click here for the 6 trades >>